Tasmania will set up its own state-owned insurance company to tackle soaring premiums that have jumped 35% in just two years, if the Liberals are re-elected, Premier Jeremy Rockliff says.
TasInsure would operate under the Motor Accidents Insurance Board (MAIB) and could save households up to $250 a year while cutting small business costs by 20%.
It would offer home, contents, small business, community group and regional cover.
“The market nationally has failed Tasmanians,” Rockliff said during the campaign announcement in Launceston.
“We need cheaper, fairer and our own insurance company here in Tasmania.”
The premier said rising insurance costs had become the top issue for many Tasmanians, with some businesses forced to shut their doors and community events cancelled because premiums were simply unaffordable.
Unlike commercial insurers, who made $6 billion in profits nationally last year, TasInsure would reinvest its profits to keep premiums low, Rockliff said.
“Every time there is a major flood, a bushfire and we’re a very big country, Tasmanians pay for that,” he said, adding that disasters on the mainland push up insurance costs for everyone.
Tasmanian Chamber of Commerce and Industry CEO Michael Bailey welcomed the proposal, calling it “game-changing” for small businesses.
“We know too many Tasmanian businesses are underinsuring or not insuring at all,” Bailey said.
“To have our own insurance firm that can provide a lower premium cost for Tasmanian businesses with the same coverage using the balance sheet of MRIB is a really clever move.”
While commercial insurance premiums have surged by 35% in recent years, MAIB premiums have risen by just 5%.
Local resident Carol Mackintosh, who has held insurance for more than 50 years, said the idea was “very exciting” and that she is keen to see if it offers better value.
“What I’m more interested in is getting a good product, seeing if it’s for us and seeing if it is good value for money,” she said.
If re-elected, the government expects to have draft legislation ready by the end of the year.
It will then need national accreditation from the Australian Prudential Regulation Authority before TasInsure can open its doors.
